Goldman Sachs CEO David Solomon remembers what life was like before AI, and is all in on using it to expand the ranks of his bank in the next decade.
Speaking to Bloomberg journalist Tom Mackenzie on Friday in Italy, Solomon said AI had the hallmarks of being able to grow the firm's headcount over the next decade, not reduce it.
"When I started 42 years ago and I wanted to look at five different companies and think about how to compare the trading in five different companies, I had to go to the library, I had to go to the microfiche, I had to spend hours really thinking about how to put that comparison together," Solomon said. Now, you can do that "just speaking into your phone," he said.
It's a glimpse at the kind of high-tech world Solomon seems to want to create for his bankers. The firm spent roughly $6 billion on tech this year, the CEO noted, musing that he wished it had been more.
"If you think about Goldman Sachs and the value it brings to its clients, its value is deployed really among three different things: people, capital, technology," Solomon said. He added that the tech "allows smart, talented, driven, sophisticated people" to access better information and conduct enhanced analysis. Here's a look at Solomon's AI-powered vision for the bank, from headcount to investment trends.
Headcount
A decade from now, "I think we're going to be running a much bigger enterprise," he said. "There are obviously things where we're going to have a lot fewer people — but I'd love to have the capacity to go get more people to spend time with clients."
"I think we can continue to serve a wider slice of clients with these tools, and these capabilities being integrated into the firm," he said. "If the firm was the same size and it didn't grow, we would certainly be operating with fewer people. But if the firm grows and you expand and you can invest in other areas for growth, we'll wind up with more jobs 10 years from now than we have today."
Goldman employs about 46,000 people, according to midyear earnings disclosures; and boasts a workforce of roughly 12,000 technologists reporting to Marco Argenti, the firm's chief information officer, who recently spoke to Business Insider about his own vision for the firm's AI future.
Boosting coders' productivity
Solomon said he wished the $6 billion the firm will spend on tech this year was actually "eight, but I can't afford it because I've got to deliver returns."
The most immediate impact, he suggested, will come in software development. "So one great coder now, with tools such as Cognition Labs' Devin, for example, really creates massive coding capacity for one coder as opposed to having 10, 20 people sit around for a few days. So, big productivity there," he explained, referencing a partnership the firm announced this year.
Goldman also rolled out its own internal AI assistant to all employees this summer.
Winners, losers, and the 'AI bubble'
Asked whether the AI boom could generate a bubble that's bound to burst, Solomon demurred from saying yes or no, but conceded that some will have the upper hand and others will be left holding the bag.
"I guarantee to you, at the end of the movie, there'll be a bunch of winners, and there'll be a bunch of losers," he said. "There'll be a bunch of capital that was deployed that ultimately delivered very attractive returns, and there will be a lot of capital that was deployed that did not deliver returns."
"People are out on the risk curve because they're excited," he added. "And when they're excited, they tend to think about the good things that can go right and they diminish the things you should be skeptical about that can go wrong."
